Toxic economic mix poisons new vehicle sales
May new vehicle sales plummeted by 9.2%, to 49 465 units, compared with the same month last year, statistics released by the Department of Trade and Industry showed on Monday.
The South African new passenger car market, at 32 984 units, declined 4 207 units, or 11.3%, compared with May last year.
Domestic sales of new light commercial vehicles, bakkies and minibuses, at 13 866 units, declined by 5.1%, while sales of medium trucks, at 830 units, dropped by 14.4%.
New heavy truck and bus sales provided the only good news for the month, increasing by 4.3%, to 1 785 units.
May vehicle export sales from South Africa dropped by 40.5% compared with the same month last year, to 15 613 units.
The National Association of Automobile Manufacturers of South Africa (Naamsa) said in a statement that the decline in export sales was due to the temporary lack of exports by Mercedes-Benz South Africa, as it geared up production of the new C-Class.
Volkswagen Group South Africa was also gearing up for production and export of the refreshed Polo.
Exports were expected to improve from the middle of the year.
The outlook for the South African automotive sector for the balance of the year, however, looked increasingly less promising, noted Naamsa.
“In the case of domestic sales, the challenging macro-economic environment characterised by lower growth, exchange rate-induced new vehicle price increases, and further upward pressure on interest rates will translate into difficult domestic trading conditions and pressure on margins, particularly in the new car and light commercial vehicle sectors.”
Naamsa anticipated that the new vehicle domestic market was likely to decline between 3.5% and 5.0% in 2014 compared with 2013.
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